Tigo IPO now imminent

Dar es Salaam. The initial public offering (IPO) of Tanzania’s second largest telecoms firm, Tigo, now looks imminent following yesterday’s Court of Appeal verdict on an ownership dispute.

The Court of Appeal yesterday ruled against Golden Globe International Services Ltd (which is believed to be owned by tycoon Yusuf Manji) and Quality Group Ltd in the ownership of MIC Tanzania Limited, which operates as Tigo Tanzania.

Golden Globe International Services, which is registered in the British overseas territory of Virgin Islands, was claiming ownership of 99 per cent of MIC Tanzania Ltd.

The two companies claim to have bought 34,479 shares in MIC Tanzania Limited in 2014 through a Sh13 billion transaction.

The transaction was conducted in accordance with a 2002 civil dispute whereby a British national, James Allan Russel Bell, filed a Civil Case No. 306/2002 against MIC UFA Ltd, Millicom International Cellular SA, and MIC Tanzania Limited.

In the case, Millicom NV was not a party. Mr Bell, the plaintiff in the proceedings, managed to get a default judgment against MIC UFA Limited and Millicom International Cellular SA.

The Plaintiff attempted to execute the judgment against shares in Tigo but could not because High Court Judge Laurian Kalegeya, as he then was, on November 7, 2009 ruled that such shares were not owned by Millicom International Cellular SA, but rather Millicom NV, a wholly separate legal entity.

In February 8, 2014, Russel Bell lodged another appeal for execution of the earlier ruling, saying his shares were being owned by Millicom International Cellular in Tigo Tanzania.

There have been ranges of claims as regard to transfer of shares of Tigo with Millicom (Tanzania) NV, a limited liability company registered under the laws of Curacao claiming to be the majority shareholder of MIC Tanzania Limited.

In February last year (2017), the Court of Appeal dismissed all grounds of objections that Golden Globe International Services Ltd and Quality Group Ltd had raised against the proceeding hearing.

Justices Mbarouk Mbarouk, Augustine Mwarija and Shaban Lila overruled the grounds of objections and ordered the revision proceedings to be set for hearing.

And yesterday a three-judge bench of Court of Appeal judges involving Stella Mugasha, Rehema Mkuye and Jacobs Mwambegele ruled against Golden Globe International Services Ltd and Quality Group Ltd.

Reading the court’s judgment on behalf of the three judges, the Court of Appeal Registrar, Mr John Kahyoza, said the Court was convinced that Millicom Tanzania (NV) had genuine grounds to oppose claims by Golden Globe International Services Ltd and Quality Group Ltd over ownership of the company.

He said the court was satisfied that the execution of the High Court ruling that awarded the company’s ownership to the Briton was based on a faulty process, hence rendering the share sale null and void.

He said the court was thus rescinding the share sale and thus the money should be returned to the buyer.

“We are also ruling that the 34,479 shares which were sold must be immediately returned to Millicom Tanzania (NV),” said the Court of Appeal Registrar, quoting the three judges.

Yesterday’s ruling paves the way for Tigo’s IPO to go live in line with the Electronic and Postal Communications Act, 2010.

Under the Act, telecommunication firms are required to offload 25 per cent of their shares to the public.

Tigo managed to go through several processes but could not proceed further due to ownership wrangles.